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80% occupancy and $228 RevPar likely for Dubai hotels in 2012

Regionally, the Egyptian hotel market is showing continued signs of recovery following the events of the Arab Spring

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Tourists check in and out of the hotel Atlantis in Dubai
Gulf News

Dubai: Hotels in Dubai are expected to see 80 per cent occupancy, $228 (Dh838.5) in RevPAR (revenue per available room) and $285 in average daily rate for 2012 based on strong performance in the first nine months of the year, according to TRI Hospitality Consulting.

Dubai hotels showed positive performance in the first nine months of this year compared to the same period last year across performance indicators while the Abu Dhabi hotel market showed significant decline, TRI Hospitality Consulting revealed in its latest HotStats survey of full-service hotels in seven Mena (Middle East and North Africa) cities.

The study showed that with regards to Dubai hotel profits, Goppar (total gross operating profit for the period divided by total available rooms during the period) increased 14.5 percentage points in the same period last year to reach $158.52.

Dubai hotels recorded 79.4 per cent occupancy in the first nine months, while RevPar (revenue per available room — the performance benchmark) increased 9.1 percentage points to $215.83 and average room rate climbed 8.2 percentage points to $271.87 compared to the same period last year, the study revealed.

“We are bullish on Dubai and see a continuation of strong occupancy and overall RevPar. There is no reason to assume those figures are going to drop, it looks very positive in the last quarter,” said Peter Goddard, managing director of TRI Hospitality Consulting in Dubai. “Dubai has reached a point where it is at critical mass. It is past the point were people are experimenting and they are coming back repeatedly, we see this continue.” Meanwhile, Abu Dhabi hotels recorded weak performance in the first nine months as performance indicators declined compared to the same period and the city had the lowest registered profit in the GCC for the month of September, according to the survey.

For Abu Dhabi hotels, Goppar declined by 18.9 percent to $70.55, while RevPar dropped 12.5 percentage points to $91.18 and ARR (average room rate) was down by 13.9 percentage points to $136.23 in the first nine months of 2012 compared to the same period last year. Occupancy was at 66.9 per cent in the first nine months, up one percentage point from the same period last year.

In Dubai, September’s performance indicators showed a 2.8 percentage point decrease in occupancy to 74.3 per cent, ARR increased by 3.9 per cent to $218.30 and RevPar was up just 0.2 per cent to $162.10.

A host of events such as Index and Gitex exhibitions continued to maintain healthy demand levels after Eid Al Fitr, Goddard said. Meanwhile, Abu Dhabi’s hotels had weaker performance indicators due to heavy reliance on corporate demand which was subdued in September, he added.

Regional performance

The Egyptian hotel market continued to show ongoing signs of recovery, according to the survey.

“Our HotStats data for September shows a steadily recovering Egyptian market with hotels in Cairo registering their highest profits in a year. Sharm Al Shaikh is well on its way to recovery, in spite of travel agent fees that continue to diminish profit margins. With the city’s high season approaching we anticipate continued growth for the remainder of 2012 and early 2013” said Goddard.

In September, occupancy rates in Cairo grew to 55.4 per cent, while RevPAR and stood at $63.63.